Accounting Policies of Suryaamba Spinning Mills Ltd. Company

Mar 31, 2024

1.4 SUMMARY OE MATERIAL ACCOUNT ENG POLICIES a) Property. Plant and Equipment -Measurement ai Recognition

An item cf prjajpertv plant and equipthat qaaiities as an asset is measured cu the initial recognition at c&sL Fellow mg the initial recognition. item of property. plant and equipment are earned at it: east less accumulated depreciaEon and accumulated impairment losses, if am The Co nip any identifies and determines east of each part if an item of property, plant and equipment separate!’;, if the pan has a scat which is significant to the Total cost of diat item of prcpery plant sr.d equipment and has useful life that is materially different from that cf ike remaining items.

The cost of an item of property, plant and equipment comprises of its purchase price net of discounts. n" any. including import duties and other non-re fundable purchase taxes or levies directly attributable cost of bringing the assets to- its present location and working condition For its intended use and. the initial estimate of decommissioning, restoration, and similar liabilities. {/’anr. Cost includes the cost of replacing a part of the plants and equipments if the recognition criteria are met Expenses directly attributable to new manufacturing facilities during its construction period are capitalized if the recognition criteria are met Expenditure related to plane, designs and drawings cf buildings or plants and machinery are capitalized under the relevant heads of prep erf. plant and equip menu if the recognition criteria are me: ""."hen significant nans of property, plant and equipment are required t:- he replaced at periodical intervals, the Ccmpany recognizes such parts as individual assets with specific useful lives and depreciates them accordingly

Subsequent costs are included in the asset''s canyiug amount or recognized as a separate asset, as appropriate, only when it ts probable that future economic benefits associated with the item will flow to the Company and the cost cf the item can be measured reliably. The carrying amount of any components accounted for as a separate asset is derecognized when replaced.

All the costs, including administrative, financing end general overhead expense:. as are specifically attributable to construction of a specific projects cr to the acquisition of a property. plant ar.d equipment or bring mg it to its present location ar.d working condition, is include as a part of the co3t of c instruction of the project or as a part of the cost of property, plant and equipment, till the commencement of its commercial production. Anv adtusimenls arising from exchange rate variations attributable to the property, plan: and equipment are capitalized as aforementioned

Borrowing costs relating to the acquisition construction of property, plant and equipment which takes the substantial pened of time to get ready for its intended use are also included in the cost cf property, plant and equipment ccst of constructions to the extern they relate to the period till such property, plan: and equipment are ready to be put to use.

Any subsequent expenditure related to an item of property, plant and equipment is added to it3 bock value only and only if it increases the future economic benefits from die existing asset-: beyond its previously assessed standard cf performance.

Anv items such as spare carts, stand-by equipment: and servicing equipments that meet the definitions criteria of the property, plan: and equipment are capitalized a: cost and depreciated over the useful life of the respective property, piam and equipment. Cost is in the nature of repairs and maintenances are recognized in the statement of crcfi: and loss as and when incurred.

Capital Work-in-Prosress and Capital Advances

Cost of property, plan: and equipment not ready for intended use, as at the balance sheet date, is shove as a '' Capital ^''ork-iyi-Prc^rssi The capital work-in-progress is stated at cost. Any expenditure in relation to survey and investigation of the properties :: carried out a: capital work-in-progress, sucSi expenditure is either capitalized as cost of the projects ca completion o f construe hen project or die same is expensed in the period in which it is decided to abandon such projects. Any advance: given towards acquisition of property, plant and equipment outstanding at each balance sheet date are disclosed as "QMar.Yov - Cwrsn: Asseis"

The Company ha: elected to consider the carrying value cf all its grocery, plants and equipment: appearing m it: financial statements and used the same as deemed cost in the opening Ind AS Balance Sheet prepared at .April 01 TOld.

Depreciation on sack part of crop err: pi at: and equipment are provided to fee extent of tiie depreciable amount of the assets on the basts of "Straight Lin* Method (SLMi'' on the useful lives of the tangible property. plant and equipment as estimated by the Company''s management and is charged to the statement of profit and loss, as per the requirement of Sc iodide. - 11 :o ihe Cc-ynpanisc Act. 2013. The estimated useful lives of the property, plant and equipment has been assessed based on the tedmical advice, which :s considered in the nature of the property, plant and equipment the usage of the property, plant and equipment, expected physical tvear and rear of such property, plant and equipment, tiie operating conditions, anticipated technological changes, manufacturer warranties ar.d maintenance support of the property, plan: and equipment etc

When the parts of an item of the property plant and equipment have different useful lr^_es. they are accounted, for as separate items - major components and are depreciated over their useful lives or over the remaining useful lives of the crmcical property, plant and equicmem. whichever is less

The Company based on technical assessment made by ^riie technical experts and the Compare'''': management estimate, depreciate certain items of property plants and equipment ct’er the estimated useful li”es ¦vhich are different icm the useful lives as prescribed under Schedule - II oy''tijs Companies Ac; 2013. The Company''s management beheves that the useful lives given above are best to represent the period ever which Company''s management expects to use this property. plant and equipment.

Freehold land is not depreciated. Leasehold land and their [mprove=nent cost are amortized ever the period of the [ease

The useful lives, residual value of each part of an item of property, plant and equipment and method of decreelaticr. is reviewed at the end of each reporting period, if any. of these expectations differ from the previous estimates, such change is accounted for as a change m accounting estimate and adiusted prospectively, if appropriate

Dene cognition

The carrying amount of an item of property, plent and equipment and other intangible assets are recognized on disposal or when r.c future economic benefits are expected from its use or disposal The gain or less arising hem derecognition of the property, plant and equipment is measured as the difference between the net disposal proceeds and the carrying amount of tie assets and is recognized in the statement of profit and loss, as and when the assets are de-recognized.

b) In tangible Assets Measurgni^nt ai Recagpjtjon

Intangible assets acquired separately measured on tire initial recognition a: cost. Intangible assets airising on the acquisition cf businesses are measured at fair value as at the elate cf acquisition Internally generated intangible assess including research ccsts are nor capitalized and the relaxed expenditure is recognized in the statement of profit and loss m the period in which the expenditure is incurred Following ihe initial recognition, mtsngible assets are earned at cost less accumulated amortization and accumulated impairment loss, if axy

liie Company has elected tc consider the carrying "slue cf all intangible assets appearing m its financial statements anti used the same as deemed cost i:i the opening Ir.d AS Balance Sheet prepared at April 01, lulb Amo 1''iiza lion

Intangible assets with the finite lives are amortized on a ''Sffioigfcf ZitjeS Bcizi: " over the estimated useful economics lives of such intangible assets The amortization expenses on intangible assets with finite lives are recognized in the Statement of profit and loss. The estimated useful life cf intangible asset is mentioned below

Ihe amortization period and the amc-fUzation method for an intangible asset with the finite useful lives are reviewed at the end of each financial year If any of these expectations differ from the previous estimates, such changes ate accounted for a: a change in an accounting estimate and adjusted prospectively, if appropriate.

Derttognirion

The cam dug amount of an intangible asset is derecognized at disposal or when nc future economic benefits are expected from its use or disposal. Ihe gain or loss arising if cm the de-recogmticn of an intangible assets is measured as the difference between the net disposal proceeds arsd the carrying amount of the intangible assets and is recognized in the statement of profit and loss, as and ’"hen such assets are be-recognize a.

c) Impairment

Assessment for impairment is done at each Balance iikeei date as tc whether there is any indication that a acn-fiaancia- asset may be impaired. .Assets that have an indefinite useful life ate net subject to amortization, and are rested for impairment annually and whenever there :s an indication that the asset-: may be impaired

Assets that are subject to depreciation and amortization and assets representing investmejif in subsidiary and associate companies are reviewed for impairment, whenever events or changes in circumstances indicate that carrying amount may not be recoverable. Such eircumstances include. though are net limited to. significant or sustained decline mrevenues or earnings and material ad''wrse changes in the economic environments.

Tiie Company assesses at each reporting date, whether there is an indication that assets may be impaired, if any indication exists based on internal -or external factors, or when Annual impairment testing for assets is required, the Company estimates die asset''s recoverable amount. Where die carrying amount cf the assets or its cash generating unit (CGl_!) exceeds its recoverable amount, die assets are ccnsidered impaired and written down to its recoverable amount Ihe recoverable amount is greater oithe fair value less cost to sell and "alue-m-use. In assessing value-muse. the estimated future cash flow: are discounted to their present value using a pre-tax rate that reflects current market rates and the risk specific to the assets. Fnr an asset iliac does not generate large!" independent cash inflows, the recoverable amount is determined for die CGU to which the assets belong Fair " alue less cost 10 sell is the best estimate of the ameum obtainable from the sale cf an assets in an arm''s length cransactic ns between know! edge able.

vailing parties.. less cost of disposal After the impairment. depreciation is provided c_E the revised carrying amount of the assets over its remaining Useful lives.

Reversal of imcairmen: losses recognized m prior years is recorded When Were is an indication that the impairment Losses recognized for ±e assets no longer exists or has decreased However, the increase m the carrying amount of assets due to the reversal of an impairment io:s is recognized to the extent it does- exceed the Carrying amount that would have been determined (net of depreciation''! had no impairment loss been recognized for the assets in the prior years.

Impaument losses, if any, are recognized m the statement of profit and lcs3 and included in depreciation and amortization expense impairment losses are reversed ui the statement of prof.- and loss only to the extent that the asset''s carrying amount dees net exceed the carrying amount that tv uu Id hare been determined if no impairment loss-had previously been recognized.

d) Revenue Recognition

Reveape from Contracts with Customers

Revenue from contracts with customers is recognized on transfer of control of promised goods or ser ices to a customer at an amount that reflects the consideration to which the Company is expected £0 be entitled ini exchange for those goods or services. Revenue towards satisfaction of a performance obligation is measured in the amount of transaction price (.net of variable consideration on accounts of Various discounts and -schemes offeree by die Company as a part of the Contracts '' allocated to that performance obligation. These variable considerations are estimated based on the expected value of outflow Revenue liter of variable consideration 1 is recognized only to ±e extent that it is highly probable shat the amount will not be subject to significant reversal ..’ hen uncertainty relating to its recognition is resolved.

Sale of Products

Revenue tom sties of goods is recognizee ¦¦''-hen control on the goods has been transferred 10 the customers. The performance obligation in the case of 3ale of goods; is -satisfied at a point Ln time i.e. when the material is shipped to the customers or delivery to the customers as may be specified in the contracts with them.

Sales (Gross'') excludes Goods and Service Tax (GST 1 and is a net of discounts and incentives 1c the customers.

Sale of Services

Revenue from sales of service is recognized ever time by measuring the progress towards satisfaction of performance obligation for the service rendered The revenue is recognized based on the agreements arrangements with, the customers a:- the series is performed and based on the satisfaction of performance obligation.

Ad"ances from customers are recognized uadei "Ollier CurrsKi Liabilities '' and released tc revenue on satisfaction of performance obligation.

Interest

Revenue from interest income is recognized using the effective interest mefhe-d Effective interest rate (EZR) is the rate that exactly discounts the estimated future cash payments or receipts over the expected life of the financial instruments or a shorter period, ¦’¦ here appropriate, to the grot-: carrying amount of the financial assets or to the amortized cost of financial liabilities.

e) Government Grants and Subsidies Recognition unti Measurements

The Company recognizes grant mcziKie vieo there is reasonable assurance that the Company will comply with alt the necessar’-^- conditions attached to them and the grant ’"ill bE received in accordance with Ind AS - 20.

''Accounting ter G-overnmetil Gray,!: entdDisclosure ofGmkfmnettf Assistance'' The Company is entitled to certain n-cii-refundable subsidies from the Got eminent in reasiect uf manufacturing units located in the state of Maharashtra, which are measured at amounts receivable from the Government

Income from such benefits is recognized on a systematic basis over the period in which the related costs that are intended to be compensated by such grants are recognized

Presentation

Income torn the above grants and subsidies are ptesented under Revenue from. Operations,

f) Inventories

Raw material, wort-in-progress, finished g-oeds. patinag material, stores and spares, components, consumables and stock-in-trade are carried a: lower of cost and net realizable " alue However; materials and other items held fer use m the production cf inventories are not written - down below cost, if the finished goods in which they will be incorporated are expected to be sold a: or -above costs. The comparison of costs and net realizable value is made on an item-by-item basis. In determining the cost of raw materials, wort-in-piosress. finished goods, packing materials, stores and scares, components and stock-in-trade. Weighted Average" method is used. Cost of inventories comprises all costs of purchase, non-refuudable duties and taxes, cost of conversion including an appropriate share of fixed and variable production overheads and all other costs incurred m bringing the inventory to its present location and conditions.

Â¥et Realizable " n the estimated selling price of inventories m the ordinary course of business, less estimated

coats of completion -and estimated cost necessar to make the sales of the products

The Company considers facicrs like estimated shelf Life, produce discontinuances and aging of inventory m determining the provision for slow moving, obsolete and o-lher non - saleable inventory and adjusts the inventory provision to reflect the recoverable value of the inventory.

2j Financial Instruments

A financial instrument is in any contract that gives rise to the financial assets of one entity and financial liabilities or equity instruments of another entity

Financial Assets

Initial Recognition and Measurements

The Company recognizes a financial asset in its- balance sheet as and when it becomes parr^- tc the contractua! provisions of the instruments. Alt the financial assets are recognized initially at fair value, plus in the case of financial assets not recorded at fair value through profit or toss iFYTFLi. transaction co-sts that are attributable to the acquisition of the financial assets. However, trade receivables that do not contain a significant financing component are measured at transaction price

Where the fair value of a financial assets at initial recognition is different from its transaction price, the difference between the fair value and die transaction price is recognized as a gain or loss m the statement of profit and loss at initial recognition, if the fair “alue is determined through a quoted market pi ice in an active market for an identical asset i L.e level l input:- or through a valuation technique that uses data from observable markets ;i e level 2 input''

In case tiie fair value is not determined using a level 1 or level 2 input as mentioned abo"e. the difference between the fair value and transaction price is deferred appropriately and recognized as a gam or loss in the statement cf profit and loss ofllv to the extent that such gam or loss arises due tc a change ir. factor that market panicipaui.v taken into account tv lieu pric in g the financial assets.

Subsequent Measurement5

Fcr subsequent measurements. the Company ctasssSeL a financial asset in accordance with tire below catena:

1) The Company" 3 business mode! fcr managing the financial assets and il 1 The contractual cash it-c-ws characteristics of the financial assets.

Based on the above criteria, the Company classifies its financial assets into the fuflowing categories, il Financial assets measured at amortized costs

in Financial assets measured at fair "alue through other compreljerLsive income -,F\TOCL

till Financial assets measured at fan value through profit or toss ''FVTPL1 Fitia 11 ciai Assets measured at Amortized Costs

A financial asset is measured at the amortized costs if both the following conditions are met:

a) The Company’s business model objective for managing the financial assets is tc bold financial at-sets in order to collect contractual cash flows, and

b The contractual terms of the financial assets give rise on specified dates tc cash flows that are solely payments of principal and interest on the principal amount outstanding.

this category applies to cash and bank balances, trade receivables, loans and other financial assets of the Company. Such financial assets are subsequently measured at amortized cost using the effective interest method. Under the effective interest method, the future cash receipts are discounted tc- ±e inittal. recognition value using the effective interest rate The cumulative amortization using the effective interest method of the difference between the initial recognition, amounts and the maturity amount is added to the initial recognition value i.net of principal repayments, if any;- of the financial assets over the relevant period of the financial assets to arrive at the amortized costs at each reporting date The corresponding effect of the amortization, under effective interest method re recognized a: interest .income over the relevant period of the financial assets The same is included under "Otksr Iwedm* in the statement of r-rofit and loss. The amortized costs of financial assets are also ad lusted for loss allowance, if aisv.

Funmctal Aswt⁷- measured at FYTOil 1

A financial asset is measured at FVTOCI if both of the following conditions 2te met:

al The Company''s business model objective for managing the financial assets is achieved both by collecting contractual cash flows and selling the financial assets, and

b) The contractual terms of ±e financial assets give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

This categor" applies to certain ten estmer.ts in debt instruments. Such financial assets are subsequently measured at fair ¦ alue at each reporting -date. Fair value changes are recognized m the Other Comprehensive Income < OCT-However, the Company recognizes interest income and impairment losses and its reversals in the statement of profit and loss.

On de-iwzosnitbbii of such financial assets. cumulative sun or loes previouslyfecognizeil in OCI is reclassified from equity id die itate ment of profit -and loss.

Further. the Company through an irrevocable election at initial recognition has measured certain urvesfti&£iltS in equity instruments at FYTOCI. Tiie Company lias made such selection on an instrument-by-mstnHaerit basis. These equity instruments are neither held for trading nor are contingent consideration recc-gnizsd under a business combination. Pursuant to such irrevocable election, subsequent changes in the fair value of such equity instruments are recognized in other comprehensive income. However, the Company recognizes dividend income atom such instruments m the statement of profit and loss, when the right to receive such payment is established, it is probable that the economic benefits wall Howto the Company and the amount can be measured reliably.

On tie-recognition of such financial assets, cumulative gam or loss previous3y recognized m OCI is not reclassified from equire tc the statement of ptofit and loss. However, the Company may transfer such cumulative sain or loss into retained earnings w ithin equity.

Fjnanciaj Assets measured at FVTPL

A financial asset is measured at FVTPL unless it is measured a? amortized costs or at F\TOCI as explained above. This is a residual cate gore applied to al! other investments of the Company excluding investments in subsidiary an-i associate companies. Such Financial assets are subsequently measured at fair value at each reporting date. Fair value changes ate reoogmzed m the statement of profit and loss.

Deretognicicm

A fin-ancial asset [or. where applicable, apart of a financial assets or part of a group of similar financial assets is derecognized £i e. removed from the Compinv''s balance sheet i when anv of the following occurs

11 The contractual rights to cash flows from the financial assets expire

in The Company transfers its contractual rights tc receive cash flows of the financial assets and iias substantially transferred all the lists and rewards of ownership of the financial asset.

m) Tiie Company retains the contractual rights to receive cash flows but assumes a contractual obligation to pay die cash flow’s without material delay tc one or more recipients under a pa;j-through arrangement [thereby substantially transferring all the risks and rewards of ownership of the financial assets''.!.

iv''j The Company neither transfers nor retains substantially all risk and rewards of ownership and does not retain control over the financial assets

In cases, where the Companv has. neither transferred nor retained substantiallv ail the risks and rewards cf the financial assets, but retains control of the financial assets, tiie Company continues to recognize such financial assets to ihe extent of its continuing involvement m the financial assets. In Hint case, the Company also recoguizes an associated liability The financial assets and the associated liabilities are measured on a basis that reflects the rights and obligations that the Company has retained.

On de-reccgnittcm of financial assets, {except as mentioned :u above for financial assets measured at F\TOCI} the difference between the carrying amount and the consideration received is recognized in the statement of profit and loss.

Impairment of Financial Assets

The Company applies expected credit losses .ECL) model fcr measurements and recognition el less allowance on the following:

i) Trade receivables

in Financial 2-:sele measured at amortized costs i other titan trade receivable:''-

til? Financial a:sets measured at fair value through ether comprehensive income -FTTGCTl

In tiie caste of trade renewables. the Conapany follows a simplified approach wherein an amount equal to lifetime ECL is measured and recognized a: loss allowance

In the case of other assets i. listed as it and lii above;, tiie Company determines if there has been a significant increase til credit risk of the financial assets since the initial recognition. If the credit nsl: of such eaaets has not increased significantly, an amount equal to twelve months ECL is measured and recognized as toss allowance. However, if credit risk has increased significantly, sit amount equal lo lifetime ECL is measured and recognized as loss allowance.

Sub sequently_; if the credit qualitv of the financial assets improves such that there is no- longer a significant increase in credit rislc since initial recognition, the Companv reverts to recognizing impairment less allowance based on twelve months ECL.

ECL is the difference between all contractual cash Sows that are due to the Company ia accordance with the contract and all the cash flows that the entity expected to receive ii.e.. all cash shortfalls:, discounted it the original effective interest rate. Lifetime ECL are the expected, credit losses resulting fiom all possible default events over the expected life of financial assets. Twelve months ECL ts a portion of the lifetime ECL which results from default events that are possible within twelve months from the reporting date

ECL are measured m a manner that they reflect unbiased, and probability weighted amounts determined by a range of outcomes, taking into account the time v alue of money and other reasonable information available a: a result of past events, current ccadmens and forecasts of future economic condition-:.

A: a practical expedient, the Ccmpanv u:e: a provision matrix: to measure lifetime ECL on its portfolio of trace receivable: The provision matrix i: prepared based on historically observed default rates over the expected life of trace reeevafcles ar.d is adjusted for forward-looting estimate:. At each reporting date. ±e historically observed default rates and changes in! the forward-leaking estimates are updated.

ECL impairment loss allowance (or reversal! recognized during the reporting pened are recognized as income expense m the statement of pro fit and I053 under the head ''Other Expense-:

Financial Liabilities;.

Initial Recognition and Measurements

The Company recognizes financial liabditie: in its balance siteet vhesi it become: party to the contra ctua! pro vis ions of the instrument: .AL1 financial liabilities are recognized initially at fair "arue. in the case of financial liabilities not recorded at fair "line through profit or loss fFYTPL.-. tfansaetton costs liiat are attributable tc the acquisition of the financial liabilities.

Where the fan value of a financial liabilities at initial recognition is different from its transaction price, the difference between the fair value and the transaction once is recognized as a gam or loss m the statement of profit and loss at initial recognition if the fair value is determined through a quoted market price m ar. active market for an identical asset ii.e. level 1 input ¦ or through a valuation technique that uses data from observable markets (i.e. level 2 input).

In case the fair value is not determined using a level i or level 2 input as mentioned above, the difference between the fair ’.''alue and transacts a p-rree is deferred appropriate!v and recognized as a gain or loss in the statement of profit and loss, only tc the extent that such gain or los: arises, due t-o a change in factor that market participants taken into account when pricing the financial liabilities.

Subsequent Measurements

All file financial liabilities dfthe Cctnsian" are subsequentl’^- measured at amortized costs using the effective interest method

Lender the effective inters: method. the future cash payments are exactly discounted tc the initial recogruticm value using the effective interest rate. The cumulate e amortization using the effective interest method of the difference between tlie initial recognition amount and die maturity amount is added to the initial recognition value -.''net cf principal repayments. if any) of the financial liabilities over the relevant period of the financial liabilities to arrive at the amortized costs at each reporting date The corresponding effect of the amortization, under effective interest method are recognized as interest expense over the relevant period of the financial liabilities. The same is included under finance cost-: in the statement of profit and loss.

Derecognition

A financial liability is de-recognized when the obligation under ihe liabilities is discharged or cancelled or expires. When existing financial liabilities aie reel seed bv another from the same lender on substantially different terms, or the terms of an existing li abilities are substantially modified, such an exchange or modification are treated as the derecognition cf the original liabilities and the recognition cf a new liabilities. The difference between the earring amount of the financial liabilities de-recognized and the consideration paid is recognized in the -statement of profit and loss.

Offsetting of Financial Asset; and Financial L iabiliEies

Financial assets and financial liabilities are offset and ihe net amount is reported in the balance sheet if there is a currently enforceable legal ngbi to offset the recognized amounts and there is an intention to settle on a net basts- or to realize the assets and settle the liabilities simultaneouslv

h) Fail'' Value

The Company measures financial instruments at fair value in accordance with the accounting policies mentioned above. Fair value i-s rhe price that would be received tc sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair "alue measurement is based on the presumption that the transaction to sell the assets or transfer the liabilities takes place either.

* La the principal market for the assets or liabilities, or

In the absence cf a principal market in the most advantageous market for the assets or Liabilities.

All the assets and liabilities lor which fair --alue is measured or disclosed n: the financial statements are categorized within fair value hierarchy that categorizes into three levels, described are as follows, the inputs to valuation techniques used to measure value. The fair value hierarchy gk es the highest priority so quoted prices m active markets for identical assets or liabilities .Level 1 inputs! and file lowest priority to unobservable inputs (Le'' ei F inputs i.

Level 1 - Quoted (unadjusted! market prices in active markets for identical assets or Liabilities.

Level I - Inputs other than quoted pnee3 included within Level 1 that are observable for the assets or liabilities, either directly or indirectly.

Level 3 - Inputs that are unobservable for the assets or liabilities.

For assets and liabilities that are recognized in the financial statements at fan value cm a recurring basis, the Company determines whether transfers have occurred between levels in the hierarchy by re-assessing categorization at the end of each reporting period and -discloses the same

i) Foreign Currency Transactions

a) Initial Recognition

Transactions in the foreign currencies entered mto by the Company are accounted in the runchc-nat currency (Le Indian Rupee '' .1. by applying (he exchange rates prevailing oil the date of the crane action t.e. spot exchange rate. Any exchange difference arising on foreign exchange transactions settled during the reporting period are recognized in the statement of profit and loss except to the extent that they are regarded as an adjustment to the finance costs on foreign currency borrowings that are directly attributable to the acqu:srtioji or constructions of the qualifying assets, are capitalized tc the qualifying assets.

b) Measurement of Foreign Currency Items at Reporting Date

Foreign currency monetary items of the Company are restated a: at the end of the reporting cate bv using the doting exchange rate as prescribed bv the Reserve Bard: of India. ?von-monetary items sre recorded at the exchange rate pre¦ ¦ailing on the date of the transaclions i.e. measured at historical coots Ivon-monetary items that are measured at fair "alue in a foreign currency are translated using the exchange rates at the date when die fair value is measured i.e. using die exchange rate at the carte cf (ransactions. Exchange differences arising cut of foreign exchange translations- end settlements during the period are recognized in the statement of profit and toss.

j) Taxes on Income

Tax expense comprises current tax and deferred income tax. Tax expenses are the aggregate amount included m the determination of profit cr loss for the reporting period current rax and deferred income tax Tax expenses are recognized in the statement of profit and loss, except to the extent that it relates tc the items recognized in the other comprehensive income or in the equity. In that case, tax is also recognized in other comprehensive income cr equity

Current income tax is the amount of income tEfc payable in respect of taxable profit for the reporting period. Taxable profit differs from Profit 3&b’’£ Tax" as reported under the statement of profit and loss because of item of expenses or income that are taxable or deductable in other years and items that are rifer taxable or deductible under Income Tax .Act. 19(51.

Current tax assets and liabilities are measured by using the tax rates that iiave been enacted by the end of the reporting period for the amount! expected tc be recovered from or paid to the income tax authorities. Current tax also includes any adjustment amount to tax payable receivable m respect of previous reporting period.

Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities in the financial statements and die correspond mg Sax bases used in -he computation of taxable profit under Income Tax Act. 19b 1 and their earning amounts. Deferred tax is measured based on the tax rates acid the tax laiv:- enacted or Substantively enacted at the reporting date

Deferred tax assets and liabilities are generally recognized for all deductible and taxable temporary differences However, ta the case of temporary differences that arise from initial recognition of assets or Eiafcfliciee in a transaction {other than business combination i that affect neither the taxable profits nor the accounting profits or does not give rise to equal taxable ana deductible temporary difference, deferred tax assets and liabilities are net recognized Also, for temporary differences, if any that may arise from initial recognition cf goodwill. deferred tax liabilities are not recognized

Deferred tax assets are generally recognized for all deductible temporary differences, and any unused tax losses and unused tax credits, to the extent it is probable that taxable profits will be available against which those deductible temporal ¦¦ difference can be utilized. In the case of temporary differs sices that arise from initial recognition of assets or liabilities in a transaction that affect neither the taxable profits nor the accounting profits, deterred tax assets are not recognized

The carrying amount of deferred tax assets liabilities are reviewed at the end of each reporting period and reduced to the extent that it is no longer probable that sufficient taxable profits wilt be available to allow die benefits of part or all such deferred tax assets to be utilized

Deferred tax assets and liabilctjes- are measured at the fax rates that have beet enacted or stibstartlivelv enacted by tie Balance Sheet date and are expected tc apply tc taxable income in tiie vea:: m which these temporary differences are expected to be recovered or settled.

Uncertain Tax Positions

The Company'': management periodically evaluate: the positions taken m the tax returns with respect to sipjatucns in whiefc applicable tax regulation: are subject to interpretation and consider whether it is probable that a taxation authority will accept uncertain tax treatment:. The Company reflects the effect of uncertainly for each uncertain tax treatment by using one eftwo methods. ±e expected value method the sum of the possibility - weighted amounts in range of possible outcome:;'' or the most likely amount :single most likely amount method in a range of possible outcomes}, depending on winch is expected to bene: predict the resolution o: the uncertainr.^- The G&mpany applies consistent judgments and estimates, if an uncertain tax treatment affects both the current and deferred, income tax.

Presentation

Current tax and deferred tax are recognized as income or an expense in the statement of profit and loss, except when they relate to items that are recognized in other comprehensive income, in which case, the current tax and deferred tax income expense are recognized m ether comprehensive income.

The Company offset: current tax asset: and current tax liabilities, where it ha: a legally enforceable right to set off the recognized amount: and where it intends either to settle on a net basis, or to realize the assets and settle the liabilities simultaneously In case of deferred tax assets and deferred tax liabilities, the same are offset, if the Company has a legally enforceable right tc set off ccrrespending current tax assets against current tax liabilities and the deferred tax assets and deferred tax liabilities relate tc ir.eeme iaxes levied by the same tax authority on the Co ns panv

fc) Lease

A lease is classified at the inception date as finance lease or an operating lease. A lease thai transfer: substantially alt the risk and rewards incidental to the ownership of the Company es classified as a finance lease. All other leases are classified as operating lease:

The Company as a Lessee

a) Operating Lease. Rental payable under the operating lease is charged ta the statement of profit and lass on a S.Tiiig.''jr - line " basis over the term of the relevant lease except where another systematic basis is mare representative of mne pattern m which economic benefits from the leased assets are cons timed.

I>) Finance Lease Finance leases are capitalized a* the commencement of the lease, at the lower of the fair "alue of the property crihe present value of the minimum lease payments. The corresponding liabilities for the lessor are included in she Balance Sheet as a finance lease obligation. Lease payments are appropriated between finance expenses and the reduction of the lease obligation so as to achieve a constant rate of interest oil the remaining balance of the liabilities. Finance expenses are charged -directly against the income over the period of the tease unless they are directly attributable to the qualifying assets, m which case they are capitalized. Contingent rental 1: recognized as an expense in the period in which they are incurred

A leased assets are depreciated over the useful ii^--es of the -assets, hoivevef, if there is no reasonable certainty that the Compare^- will obtain ownership by the end of the lease term, the assets are depreciated over the shorter of the estimated useful lives si the assets and the lease terms

The Company as a Lessor:

Lease pz"nientz Under operating 1 eases are recognized as an income on a straight - line basis in he statement of profit and loss over the lease term except where trie lease payments are -structured to increase in line with expected general inflation The respective leased assets are included m the balance siieet based on their nature

1) Borrowing Costs

Borrowing cost include the interest, commitments charges on bank borrowings, amortization of ancillary costs incurred in connection with the arrangement of borrowings ana exchange differences arising from foreign currency borrowings to tlie extent they are regarded as an adjustment to the finance cost.

Borrowing costs, if any. that, are directly attributable tc the acquisition or ccr.sanctions or production of qualifying property, plant ar.d equipment are capitalized as a part of cost of that property, plant and equipment until such time that the assets are substantia! Iv readv for their intended use Qualifying assets are assets which take a substantial period of time to get read v for the intended use or sale

When the Company borrows die funds specially for the purpose of obtaining the qualifying assets, the borrowing costs incurred are capitalized with the qualifying assets. Wheat life Company borrows fund generally and use them for obtaining a qualifying asset, the capitalization of borrowing costs it computed on weighted average cost -of general costs that are outstanding during ±e reporting period and used for acquisition of the qualifying assets. Capitalization of the bo trotting costs ceases when substantially all the activities necessary to- prepare the qualifying assets for intended use are complete

Other borrowing costs are recognized as expanses tn the period in which they are incurred Any interest income earned on temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalization

in) Employee Benefits

Short-Tenh Employee Benefits

All the employee benefits payable wholly within twelve months of rendering the services are classified as short -term employee benefits and they are recognized 111 the period in which die employee renders the related services. The Company recognizes the undisccunred amount of short - term employee benefits expected tc be paid in exchange for services are rendered as a liability ^ accrued expense) after deducting any amount already paid.

?c Employment B e ne fits

a) Defined Contribution Plans

Defined contribution plans are employee state insurance scheme and Gcveminent administrated pension fund scheme for ell the applicable employees and superannuation scheme for all the eligible employees, who met eligible criteria. The Company''s coiitnbatier. to defined contribution plans is recognized in the statement of profit and loss in the reporting period to which they relate.

ij Recognition and Measurement of Defined Cotmiburiou Platts

The Company recognizes contributton payable to a defined contribuhen plan as an expense in the statement of profit ar.d loss when the employees render services tc the Company during the reporting period If the contribution!, payable for services received from employees before the reporting date exceed the contribution? ahead" paid, the deficit pavable «¦ rsceznized a:- a liability after deducting the contribution aireadv paid If the contribution ahead^-.^-paid exceeds she contribution due for services received before the reporting date, the excess is recognized as an asset to the extent that the prepayment will lead tc. for example, a reduction iu furur; pay ments or a cash refund

b) Defined Benefit; Plans

i) Gratuity

The Company operates a defined, benefits plan for its empLC. ee;. The Company pav; the gratuity tc employee whoever lias completed its five years of service with the Company at ±e time of retiremesit or resignation or superannuation. The gratuity is paid % If Days -saiar.- fcr every completed year of service as per the Payment c-f Gratuity Act, 19 “2.

The liabilities in respect of gratuity are calculated usms "Project Unit Cf-i&fit Method'' arid spread over tie period during which the benefits are expected to be derived from employee seraces. The remeasurements of defined benefits plan m respect cfipost - employments are charged to the other comprehensive income [ DCIj.

ii) Provident Fund Scheme

Provident fund is defined contribution plan covering certain eligible employees. The Company and the eligible employees mate 5 monthl" contribution to the provident fund maintained by the regional provident fund commissioners equal tc the specified percentage of the basic salary of the eligible employees as per the scheme. The contributions to the provident fund are charged tc the statement of profit and Loss for the period when the contributions ate due The Company has no obligation, other than the contributions payable tc the provident fund.

iii) Pension Scheme

The Company operates a defined benefit pension plan for certain specified employees and is payable upon the employee satisfying certain conditions, as approved by the Board of Directors

iv) Pott - Retire in ent Medical Benefit Plan

The Company :aerates a defined post-retirement medical benefits plan for certain specified employees and is payable upon the employee satis tying ceiiam conditions

v) Leave Encashment

Accumulated leave, which is expected to be utilized within the next twelve months, is heated as short - term employee benefits for measuremeat purposes. The Company measures the expected cost cf such absence as the additional amount that are expected to pay as a result of unused entitlement that has accumulated at die reporting date

The Company treats accumulated tea"e expected to be carried forward beyond twelve; mouths, as long - term employee benefits for measurement purpose Such long - term compensated absences are provided based cg the actuarial valuation using the "Project Unit Credit Method’ at the reporting date Actuarial gain losses are immediately talceri to the statement of pro St and less and are not deferred.

Recognition and Measurement of Defined Contiibuticm Plans

The co-st cf providing defined benefits is determined using the ‘Projected! Unit Cask Crsdi: " method with actuarial valuations being carried out at each Balance Sheet date The defined benefit obligations recognized in the balance sheet represent the present value cf the defined benefit obligations as reduced by the fair value cf plan assets if applicable- Any defined benefit assets (negative benefit defined obligaticns resulting from these calculations ¦ are recognized representing the present value cf available refunds and reductions in future contributions to the plan.

All expenses represented bv current service cost, past servee cost, if any. and net interest on denned benefit liabilities (assets! -are recognized in the statement ;f profit and loss. Remeasurement cf the net defined benefits liabilities ''assets'' comprising actuarial gains and losses and die retuiEi on the plan assets .excluding amounts included m net interest on die ne! defined benefit liabilities assets), are recognized it. other comprehensive income. Such remeasurements are not reclassified tc the statement cf profit and loss in the subsequent periods.

Past service cost is recognized immediately to the extent that the benefit* are already vested, eke k amortized on a straight-line bask over the average period mini the amended benefits become vested. Actuarial gam or ivsse: in respect of the defined benefits plan are recognized in the statement of profit and loss in the year m which they arise.

the Company presents the above liabilities as current and non-current le the balance sheet as per the actuarial valuation by the independent actuary.

n] Earnings per Share

The Company reports the basic and diluted Earnings per Share -,EPS j in accordance with lad AS - 33. ''Earningsper Share Basic EPS k computed by dividing tiie net profit or loss attributable to the equity shareholders of the Company for the period by the weighted average number of Equity share; outstanding during the period.

Diluted EPS is computed by dividing the net profit or loss attributable to the equitv shareholders for the period bv the weighted average number of Equity shares outstanding during the ceriod as adi listed tor the effects of all potential equity shares, except where the results are anti - dilutee.

the weighted average number of Equity shares outstanding during the period is adjusted for events such a bonus Issue, bonus elements in right issue, share splits, and reverse share split (consolidation of shares) that have changed the number of Equity shares outstanding, without a corresponding change in resources.

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Mar 31, 2015

1.01 Basis of accounting and preparation off manila statements

The financial statements of the company have been prepared in accordance with the generally accepted accounting principles in India (Indian GAAP) to comply with the accounting standards notified under the Companies (Accounting Standards) Rules, 2006 (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared on accrual basis under the his tonal cost convention. The company generally follows mercantile system of accounting and recogm.es significant items of income and expenditure on accrual basis. The accounting policies adopted in the preparation of the financial statements are consistent with those followed in the previous year unless otherwise stated.

1.02 Use of estimates

The preparation of the financial statements in conformity with Indian GAAP requires the management to make estimates and assumptions considered in the reported amounts of assets and liabilities (including contingent liabilities) and the reported income and expenses during the year. The management believes that the estimates used in preparation of the financial statements are prudent and reasonable. Future results could differ due to these estimates and the differences between the actual results and the estimates are recognized in the periods in which the results are known / materialize.

1.03 Fixed assets

Fixed assets are earned at cost less accumulated depreciation. The cost of fixed assets includes interest on borrowings attributable to acquisition of fixed assets up to the date the asset is ready for its intended use and other incidental expenses incurred up to that date. Subsequent expenditure relating to fixed assets is capitalized only if such expenditure results in an increase in the future benefits from such asset beyond its previously assessed standard of performance.

1.04 Depreciation and amortization

Depreciation on fixed Assets is calculated on as trough time basis using the ratesarnved at based on the useful lives estimated by the management or as per the rates prescribed under Schedule II of compares Act 2013 whichever is higher.

1.05 Inventories

Raw materials, Packing Materials, Stores and Spares are valued at cost net of VAT Credits ascertained on FIFO basis.

Work-in-progress and finished goods are valued at lower of cost and net realizable value. Cost includes direct materials and labour and a proportion of manufacturing overheads based on normal operating capacity.

1.06 Revenuer cognition

Revenue is recognized to the extent that it is probable that the economic benefits will flow to the company and the revenue can be reliably measured. The following recognition criteria is applied before revenue is recognized:

Annexure Statement of Significant Accounting Policies And Practices

Sale of goods

Revenue from sale of goods is recognized when all the significant risks and rewards of ownership of the goods have been passed to the buyer, usually on dispatch of the goods. The company collects sales tax and value added tax (VAT) on behalf of the government and therefore, these are not economic benefits flowing to the company hence, they are excluded from revenue during the year.

Interest on bank deposits

Interest income is recognized on a time proportion basis taking into account the amount outstanding and the applicable interest rate. Interest income is included under the head "other income-m the statement of profit and loss.

1.07 Foreign Currency Transactions

Expenses and Income are recorded at the exchange rate prevailing on the date of transaction. Assets and liabilities on the date of the balance sheet are restated at the exchange rate prevailing on the balance sheet date. Exchange rate differences arising on settlement of the transaction and on account of restatement of assets and liabilities are dealt with m Statement of Profit and Loss.

1.08 Employee Retirement and other benefits

Employees of the company are entitled to retirement benefits of Provident Fund, Gratuity, and Leave encashment.

a) Defined Contribution Plan:

Company's contribution paid/payable during the year to Provident Fund and Labour Welf are Fundare recognized the Profit and Loss Account.

b) Defined Benefit Plan: i. Gratuity

Gratuity is covered under the schemes of State Bank of India Life Insurance Company and premiums for such schemes are recognized the Profit and Loss Account.

At the reporting date, Company's liability towards gratuity is determined by independent actuarial valuation using the "Projected Unit Credit Method" which considers each pentode service giving rise to an additional unit of benefit entitlement and measures each unit separately to build up the final obligation. Actuarial gam and losses are recognized immediately the statement of Profit and Loss Account as income or expense.

ii. Leave Encashment

Liability on account of leave encashment has been provided on the basis of actual liability computed sat the year end.

1.09 Taxes on income

Provision for taxation for the year is based on tax liability computed in accordance with relevant tax rates and tax laws as at the Balance Sheet date. Provision for deferred tax is made for all timing differences arising between taxable come and accounting comeat the rates that have been enacted

Annexure

Statement of Significant Accounting Policies And Practices

or substantively enacted as at the Balance Sheet date. Deferred tax assets are recognized only if there 1S a reasonable certainty that they will be realized and are reviewed for the appropriateness of their respective carrying value at each Balance Sheet date.

1.10 Provisions and Contingent liabilities

Provision is recognized when the company has legal/constructive obligation for which it is probable that cash outflow may be required and reliable estimate can be made of the amount of the obligation. Contingent Liabilities not provided for are indicated by way of a Note and will be paid/provided on crystallization of the liability.

1.11 Earnings per share(EPS):

Basic earnings per share is calculated by dividing the net profit or loss for the year attributable to equity shares by weighted average number of equity shares outstanding during the year.

1.12 Impairment of Assets:

The Company assesses at each balance sheet date whether there is any indication that an asset may be impaired. If any such indication exists, the Company estimates the recoverable amount of the asset. If such recoverable amount of the asset or the recoverable amount of the cash generation unit to which the asset belongs is less than its carrying amount, the carrying amount is reduced to its recoverable amount. The reduction is treated as an impairment loss and is recognized m the profit and loss account. If at the balance sheet date there is an indication that if previously assessed impairment loss no longer exists, the recoverable amount is reassessed and the asset is reflected at the recoverable amount subject to a maximum of depreciated historical cost.

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Mar 31, 2014

1.1 Basis of accounting and preparation of financial statements

The financial statements of the company have been prepared in accordance with the generally accepted accounting principles in India (Indian GAAP) to comply with the accounting standards notified under the Companies (Accounting Standards) Rules, 2006 (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared on accrual basis under the historical cost convention. The company generally follows mercantile system of accounting and recognizes significant items of income and expenditure on accrual basis. The accounting policies adopted in the preparation of the financial statements are consistent with those followed in the previous year unless otherwise stated.

1.2 Use of estimates

The preparation of the financial statements in conformity with Indian GAAP requires the management to make estimates and assumptions considered in the reported amounts of assets and liabilities (including contingent liabilities) and the reported income and expenses during the year. The management believes that the estimates used in preparation of the financial statements are prudent and reasonable. Future results could differ due to these estimates and the differences between the actual results and the estimates are recognized in the periods in which the results are known / materialize.

1.3 Fixed assets

Fixed assets are carried at cost less accumulated depreciation. The cost of fixed assets includes interest on borrowings attributable to acquisition of fixed assets up to the date the asset is ready for its intended use and other incidental expenses incurred up to that date. Subsequent expenditure relating to fixed assets is capitalized only if such expenditure results in an increase in the future benefits from such asset beyond its previously assessed standard of performance.

1.4 Depreciation and amortization

Depreciation on fixed assets is provided on straight-line method at the rates specified and in the manner laid down in Schedule XIV to the Companies Act, 1956. Deferred revenue expenses are amortised over a period of five Years.

1.5 Inventories

Raw materials, Packing Materials, Stores and Spares are valued at cost net of VAT Credits ascertained on FIFO basis.

Work-in-progress and finished goods are valued at lower of cost and net realizable value. Cost includes direct materials and labour and a proportion of manufacturing overheads based on normal operating capacity.

1.6 Revenue recognition

Revenue is recognized to the extent that it is probable that the economic benefits will flow to the company and the revenue can be reliably measured. The following recognition criteria is applied before revenue is recognized:

Annexure I

Statement of Significant Accounting Policies And Practices Sale of goods

Revenue from sale of goods is recognized when all the significant risks and rewards of ownership of the goods have been passed to the buyer, usually on dispatch of the goods. The company collects sales tax and value added tax (VAT) on behalf of the government and therefore, these are not economic benefits flowing to the company hence, they are excluded from revenue during the year.

Interest on bank deposits

Interest income is recognized on a time proportion basis taking into account the amount outstanding and the applicable interest rate. Interest income is included under the head "other income" in the statement of profit and loss.

1.7 Foreign Currency Transactions

Expenses and Income are recorded at the exchange rate prevailing on the date of transaction. Assets and liabilities on the date of the balance sheet are restated at the exchange rate prevailing on the balance sheet date. Exchange rate differences arising on settlement of the transaction and on account of restatement of assets and liabilities are dealt with in Statement of Profit and Loss.

1.8 Employee Retirement and other benefits

Employees of the company are entitled to retirement benefits of Provident Fund, Gratuity, and Leave encashment.

a) Defined Contribution Plan:

Company''s contribution paid/payable during the year to Provident Fund and Labour Welfare Fund are recognized in the Profit and Loss Account.

b) Defined Benefit Plan:

i. Gratuity

Gratuity is covered under the schemes of State Bank of India Life Insurance Company and premiums for such schemes are recongnized in the Profit and Loss Account.

At the reporting date, Company''s liability towards gratuity is determined by independent actuarial valuation using the "Projected Unit Credit Method" which considers each period of service as giving raise to an additional unit of benefit entitlement and measures each unit separately to build up the final obligation. Actuarial gain and losses are recognized immediately in the statement of Profit and Loss Account as income or expense.

ii. Leave Encashment

Liability on account of leave encashment has been provided on the basis of actual liability computed as at the year end.

1.9 Taxes on income

Provision for taxation for the year is based on tax liability computed in accordance with relevant tax rates and tax laws as at the Balance Sheet date. Provision for deferred tax is made for all timing differences arising between taxable income and accounting income at the rates that have been enacted or substantively enacted as at the Balance Sheet date. Deferred tax assets are recognised only if there is a reasonable certainty that they will be realised and are reviewed for the appropriateness of their respective carrying value at each Balance Sheet date.

1.10 Provisions and Contingent liabilities

Provision is recognized when the company has legal/constructive obligation for which it is probable that a cash outflow may be required and reliable estimate can be made of the amount of the obligation. Contingent Liabilities not provided for are indicated by way of a Note and will be paid/provided on crystallization of the liability.

1.11 Earnings per share (EPS):

Basic earnings per share is calculated by dividing the net profit or loss for the year attributable to equity shares by weighted average number of equity shares outstanding during the year.

1.12 Impairment of Assets:

The Company assesses at each balance sheet date whether there is any indication that an asset may be impaired. If any such indication exists, the Company estimates the recoverable amount of the asset. If such recoverable amount of the asset or the recoverable amount of the cash generation unit to which the asset belongs is less than its carrying amount, the carrying amount is reduced to its recoverable amount. The reduction is treated as an impairment loss and is recognized in the profit and loss account. If at the balance sheet date there is an indication that if previously assessed impairment loss no longer exists, the recoverable amount is reassessed and the asset is reflected at the recoverable amount subject to a maximum of depreciated historical cost.

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Mar 31, 2013

1.1 Basis of accounting and preparation of financial statements

The financial statements of the company have been prepared in accordance with the generally accepted accounting principles in India (Indian GAAP) to comply with the accounting standards notified under the Companies (Accounting Standards) Rules, 2006 (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared on accrual basis under the historical cost convention. The company generally follows mercantile system of accounting and recognizes significant items of income and expenditure on accrual basis. The accounting policies adopted in the preparation of the financial statements are consistent with those followed in the previous year unless otherwise stated.

1.2 Use of estimates

The preparation of the financial statements in conformity with Indian GAAP requires the management to make estimates and assumptions considered in the reported amounts of assets and liabilities (including contingent liabilities) and the reported income and expenses during the year. The management believes that the estimates used in preparation of the financial statements are prudent and reasonable. Future results could differ due to these estimates and the differences between the actual results and the estimates are recognized in the periods in which the results are known / materialize.

1.3 Fixed assets

Fixed assets are carried at cost less accumulated depreciation. The cost of fixed assets includes interest on borrowings attributable to acquisition of fixed assets up to the date the asset is ready for its intended use and other incidental expenses incurred up to that date. Subsequent expenditure relating to fixed assets is capitalized only if such expenditure results in an increase in the future benefits from such asset beyond its previously assessed standard of performance.

1.4 Depreciation and amortization

Depreciation on fixed assets is provided on straight-line method at the rates specified and in the manner laid down in Schedule XIV to the Companies Act, 1956. Deferred revenue expenses are amortised over a period of five Years.

1.5 Inventories

Raw materials, Packing Materials, Stores and Spares are valued at cost net of VAT Credits ascertained on FIFO basis.

Work-in-progress and finished goods are valued at lower of cost and net realizable value. Cost includes direct materials and labour and a proportion of manufacturing overheads based on normal operating capacity.

1.6 Revenue recognition

Revenue is recognized to the extent that it is probable that the economic benefits will flow to the company and the revenue can be reliably measured. The following recognition criteria is applied before revenue is recognized:

Sale of goods

Revenue from sale of goods is recognized when all the significant risks and rewards of ownership of the goods have been passed to the buyer, usually on dispatch of the goods. The company collects sales tax and value added tax (VAT) on behalf of the government and therefore, these are not economic benefits flowing to the company hence, they are excluded from revenue during the year.

Interest on bank deposits

Interest income is recognized on a time proportion basis taking into account the amount outstanding and the applicable interest rate. Interest income is included under the head "other income" in the statement of profit and loss.

1.7 Foreign Currency Transactions

Expenses and Income are recorded at the exchange rate prevailing on the date of transaction. Assets and liabilities on the date of the balance sheet are restated at the exchange rate prevailing on the balance sheet date. Exchange rate differences arising on settlement of the transaction and on account of restatement of assets and liabilities are dealt with in Statement of Profit and Loss.

1.8 Employee Retirement and other benefits

Employees of the company are entitled to retirement benefits of Provident Fund, Gratuity, and Leave encashment.

a) Defined Contribution Plan:

Company''s contribution paid/payable during the year to Provident Fund and Labour Welfare Fund are recognized in the Profit and Loss Account.

b) Defined Benefit Plan:

i. Gratuity

Gratuity is covered under the schemes of State Bank of India Life Insurance Company and premiums for such schemes are recognized in the Profit and Loss Account.

At the reporting date, Company''s liability towards gratuity is determined by independent actuarial valuation using the "Projected Unit Credit Method" which considers each period of service as giving raise to an additional unit of benefit entitlement and measures each unit separately to build up the final obligation. Actuarial gain and losses are recognized immediately in the statement of Profit and Loss Account as income or expense.

ii. Leave Encashment

Liability on account of leave encashment has been provided on the basis of actual liability computed as at the year end.

1.9 Taxes on income

Provision for taxation for the year is based on tax liability computed in accordance with relevant tax rates and tax laws as at the Balance Sheet date. Provision for deferred tax is made for all timing differences arising between taxable income and accounting income at the rates that have been enacted or substantively enacted as at the Balance Sheet date. Deferred tax assets are recognised only if diere is a resonable certainity that they will be realised and are reviewed for the appropriateness of their respective carrying value at each Balance Sheet date.

1.10 Provisions and Contingent liabilities

Provision is recognized when the company has legal/ constructive obligation for which it is probable that a cash outflow may be required and reliable estimate can be made of the amount of the obligation.

Contingent Liabilities not provided for are indicated by way of a Note and will be paid/provided on crystallization of the liability.

1.11 Earnings pet share (EPS):

Basic earnings per share is calculated by dividing the net profit or loss for the year attributable to equity shares by weighted average number of equity shares outstanding during the year.

1.12 Impairment of Assets:

The Company assesses at each balance sheet date whether there is any indication that an asset may be impaired. If any such indication exists, the Company estimates the recoverable amount of the asset. If such recoverable amount of the asset or the recoverable amount of the cash generation unit to which the asset belongs is less than its carrying amount, the carrying amount is reduced to its recoverable amount. The reduction is treated as an impairment loss and is recognized in the profit and loss account. If at the balance sheet date there is an indication that if previously assessed impairment loss no longer exists, the recoverable amount is reassessed and the asset is reflected at the recoverable amount subject to a maximum of depreciated historical cost.

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Mar 31, 2012

1.1 Basis of accounting and preparation of financial statements

The financial statements of the company have been prepared in accordance with the generally accepted accounting principles in India (Indian GAAP) to comply with the accounting standards notified under the Companies (Accounting Standards) Rules, 2006 (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared on accrual basis under the historical cost convention. The company generally follows mercantile system of accounting and recognizes significant items of income and expenditure on accrual basis. The accounting policies adopted in the preparation of the financial statements are consistent with those followed in the previous year unless otherwise stated.

1.2 Change in accounting policy (Presentation and disclosure of financial statements)

During the year ended 31 March 2012, the Revised Schedule VI notified under the Companies Act, 1956 has become applicable to the company for preparation and presentation of its financial statements. The adoption of Revised Schedule VI does not impact recognition and measurement principles followed for preparation of financial statements. However, it has significant impact on presentation and disclosures made in the financial statements. The company has regrouped/reclassified the previous year figures wherever necessary in accordance with the requirements applicable in the current year.

1.3 Use of estimates

The preparation of the financial statements in conformity with Indian GAAP requires the management to make estimates and assumptions considered in the reported amounts of assets and liabilities (including contingent liabilities) and the reported income and expenses during the year. The management believes that the estimates used in preparation of the financial statements are prudent and reasonable. Future results could differ due to these estimates and the differences between the actual results and the estimates are recognized in the periods in which the results are known / materialize.

1.4 Fixed assets

Fixed assets are carried at cost less accumulated depreciation. The cost of fixed assets includes interest on borrowings attributable to acquisition of fixed assets up to the date the asset is ready for its intended use and other incidental expenses incurred up to that date. Subsequent expenditure relating to fixed assets is capitalized only if such expenditure results in an increase in the future benefits from such asset beyond its previously assessed standard of performance.

1.5 Depreciation and amortization

Depreciation on fixed assets is provided on straight-line method at the rates specified and in the manner laid down in Schedule XIV to the Companies Act, 1956. Deferred revenue expenses are amortized over a period of five Years.

1.6 Inventories

Raw materials, Packing Materials, Stores and Spares are valued at cost net of VAT Credits ascertained on FIFO basis.

Work-in-progress and finished goods are valued at lower of cost and net realizable value. Cost includes direct materials and labour and a proportion of manufacturing overheads based on normal operating capacity.

1.7 Revenue recognition

Revenue is recognized to the extent that it is probable that the economic benefits will flow to the company and the revenue can be reliably measured. The following recognition criteria is applied before revenue is recognized:

Sale of goods

Revenue from sale of goods is recognized when all the significant risks and rewards of ownership of the goods have been passed to the buyer, usually on dispatch of the goods. The company collects sales tax and value added tax (VAT) on behalf of the government and therefore, these are not economic benefits flowing to the company hence, they are excluded from revenue during the year.

Interest on bank deposits

Interest income is recognized on a time proportion basis taking into account the amount outstanding and the applicable interest rate. Interest income is included under the head "other income" in the statement of profit and loss.

1.8 Foreign Currency Transactions

Expenses and Income are recorded at the exchange rate prevailing on the date of transaction. Assets and liabilities on the date of the balance sheet are restated at the exchange rate prevailing on the balance sheet date. Exchange rate differences arising on settlement of the transaction and on account of restatement of assets and liabilities are dealt with in Statement of Profit and Loss.

1.9 Employee Retirement and other benefits

Employees of the company are entitled to retirement benefits of Provident Fund, Gratuity, and Leave encashment.

a) Defined Contribution Plan:

Company's contribution paid/payable during the year to Provident Fund and Labour Welfare Fund are recognized in the Profit and Loss Account.

b) Defined Benefit Plan:

i. Gratuity

Gratuity is covered under the schemes of State Bank of India Life Insurance Company and premiums for such schemes are recognized in the Profit and Loss Account. At the reporting date, Company's liability towards gratuity is determined by independent actuarial valuation using the "Projected Unit Credit Method" which considers each period of service as giving rise to an additional unit of benefit entitlement and measures each unit separately to build up the final obligation. Actuarial gain and losses are recognized immediately in the statement of Profit and Loss Account as income or expense.

ii. Leave Encashment

Liability on account of leave encashment has been provided on the basis of actual liability computed as at the year end.

1.10 Taxes on income

Provision for taxation for the year is based on tax liability computed in accordance with relevant tax rates and tax laws as at the Balance Sheet date. Provision for deferred tax is made for all timing differences arising between taxable income and accounting income at the rates that have been enacted or substantively enacted as at the Balance Sheet date. Deferred tax assets are recognized only if there is a reasonable certainty that they will be realized and are reviewed for the appropriateness of their respective carrying value at each Balance Sheet date.

1.11 Provisions and Contingent liabilities

Provision is recognized when the company has legal/constructive obligation for which it is probable that a cash outflow may be required and reliable estimate can be made of the amount of the obligation. Contingent Liabilities not provided for are indicated by way of a Note and will be paid/provided on crystallization of the liability.

1.12 Earnings per share (EPS):

Basic earnings per share is calculated by dividing the net profit or loss for the year attributable to equity shares by weighted average number of equity shares outstanding during the year.

1.13 Impairment of Assets:

The Company assesses at each balance sheet date whether there is any indication that an asset may be impaired. If any such indication exists, the Company estimates the recoverable amount of the asset. If such recoverable amount of the asset or the recoverable amount of the cash generation unit to which the asset belongs is less than its carrying amount, the carrying amount is reduced to its recoverable amount. The reduction is treated as an impairment loss and is recognized in the profit and loss account. If at the balance sheet date there is an indication that if previously assessed impairment loss no longer exists, the recoverable amount is reassessed and the asset is reflected at the recoverable amount subject to a maximum of depreciated historical cost.

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Mar 31, 2010

ACCOUNTING CONVENTION:

The Financial statements are prepared based on historical cost convention.

FIXED-ASSETS;

Tangible Fixed Assets are stated at cost net of depreciation as provided in the statements. Depreciation is provided on Straight line method as per Section 205 read with Schedule XIV of the Companies Act, 1956, on the basis of continuous process plant.

INYENTORIESi

Inventories are valued at the lower of cost and net realisable value. The Raw Materials and Stores and Spares are computed by using FIFO method.

FOREIGN EXCHANGE TRANSACTIONS:

Foreign currency transactions are recorded at the rates prevailing on the date of the transactions. Monetary assets and liabilites in foreign currency are translated at year end rate or at the rates of exchange fixed under contractual arrangments. Exchange differences arising on settlement of transactions and translation of monetary items are recognised as income or expense.

CONTINGENT LIABILITIES:

No liability is provided in respect of contingent liabilities, but only mentioned by way of note to accounts. SS^Su EN iofto Provident fund determined under the relavent statute and charged to revenue. The gratuity contribution has been made on the basis of acturial valuation under AS15 given by SBI life insurance Company.

The Liability for leave encashment is provided for on the basis of accrued leaves at the close of the year.

ACCOUNTING FOR INCOME TAX :

Current tax represents the amount that otherwise would have been payable under the Income-tax Act, 1961, had the financial year been reckoned as the basis for computation of tax payable under the prevailing tax laws.

DEFERRED INCOME TAX :

Deferred tax is recognised, subject to the consideration of prudence, on timing differences, being the differences between taxable income and accounting income that originate in one period and are capable of reversal in one or more subsequent periods.

MISCELLANEOUS EXPENDITURE :

Preliminary expenses are amortised over a period of ten years in equal instalments.

SALES:

Sales represent the amount realised or realisable for goods sold including freight and sales tax thereon.